Texas Instruments (TXN) Q1 Earnings Report Preview: What To Look For

Anthony Lee /
2023/04/24 2:10 am EDT
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Analog chip manufacturer Texas Instruments (NASDAQ:TXN) will be announcing earnings results tomorrow after market close. Here's what to look for.

Last quarter Texas Instruments reported revenues of $4.67 billion, down 3.35% year on year, in line with analyst expectations. It was a weak quarter for the company, with slow revenue growth and underwhelming revenue guidance for the next quarter.

Is Texas Instruments buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Texas Instruments's revenue to decline 10.8% year on year to $4.37 billion, a deceleration on the 14.4% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.81 per share.

Texas Instruments Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 4.96%.

Looking at Texas Instruments's peers in the semiconductors segment, some of them have already reported Q1 earnings results, giving us a hint of what we can expect. SMART's revenues decreased 4.45% year on year, missing analyst estimates by 1.34% and Micron Technology reported revenue decline of 52.6% year on year, missing analyst estimates by 0.37%. SMART traded down 3.44% on the results, Micron Technology was flat on the results. Read our full analysis of SMART's results here and Micron Technology's results here.

Technology stocks have been hit hard on fears of higher interest rates and while some of the semiconductors stocks have fared somewhat better, they have not been spared, with share price declining 3.93% over the last month. Texas Instruments is down 0.2% during the same time, and is heading into the earnings with analyst price target of $183.4, compared to share price of $176.7.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.